NTA UGC NET/JRF Exam, Dec. 2019 Economics (Shift-I)

Total Questions: 95

81. Given below are two statements- one is lablled as Assertion (A) and the other is labelled as Reason (R):

Assertion (A) : For certain goods, the expenditure elasticity of demand in high.
Reasons (R): For such goods, the income elasticity of demand is high.
In the light of the above two statements choose the correct option:

Correct Answer: (c) (A) is true but (R) is false
Solution:

For certain goods, the expenditure by the consumers decreases is the correct statement in the case of inferior goods, the expenditure by the consumer decreases for certain goods when their income rises.
• For luxury goods, there is high income elasticity of demand, which means that consumers buy more of them as their income increases.

82. Given below are two statements- one is lablled as Assertion (A) and the other is labelled as Reason (R):

Assertion (A): In classical model, investment demand is regarded as autonomous of changes in income or employment
Reasons (R): It is wage price flexibility which brings full employment is the classical model
In the light of the above two statements choose the correct option:

Correct Answer: (d) (A) is false but (R) is true
Solution:

Statement I Assertion is false but Statement II Reason states that there are automatic competitive forces in the economic system that tend to maintain full employment and make the economy produce output at the level in the long run.

When AD > AS or AD < AS prices and wages change accordingly to maintain full employment in the economy as per the assumption of a classical model.

83. Given below are two statements- one is lablled as Assertion (A) and the other is labelled as Reason (R):

Assertion (A): Geometric Mean is theoretically considered as the best average to Construct Index Numbers
Reasons (R): Geometric mean is used if the reange of observations are extremely large
In the light of the above two statements choose the correct option:

Correct Answer: (b) Both (A) and (R) are true and (R) is not correct explanation of (A)
Solution:

Geometric Mean is theoretically considered as the best average to construct index numbers is the true statement.
Geometric mean is used if the range of observations are extremely large, this reason is also true but not correct explanation of A.

84. Given below are two statements- one is lablled as Assertion (A) and the other is labelled as Reason (R):

Assertion (A): CES production function covers large class of production functions
Reasons (R): CES production function has th property of constancy of elasticity of factor substitution
In the light of the above two statements choose the correct option:

Correct Answer: (a) Both (A) and (R) are true and (R) is correct explanation of (A)
Solution:

CES production function covers large class of production functions the CES production function is based on large parameters. Thus the CES function has wider scope and applicability hence, the A is correct.

In the CES production function, B is the factor substitution parameter whose value ranges between 1 and ∞.

The elasticity of factor subsitution (Es) = (1/1+B) which is assumed to be constant.

It is dueto the constancy of elasticity of substitution that CES production takes the form of different types of production function.

85. Given below are two statements- one is lablled as Assertion (A) and the other is labelled as Reason (R):

Assertion (A): Intellectual Property Rights were brought into the Uruguay Round Trade Negotiations
Reasons (R): International trade restrictions can be used to discourage the violation of intellectual property rights
In the light of the above two statements choose the correct option:

Correct Answer: (b) Both (A) and (R) are true and (R) is not correct explanation of (A)
Solution:

Intellectual Property Rights were brought into the Uruguay Round Trade Negotiations is true. International trade restrictions can be used to discourage the violation of intellectual property rights is also correct statement but R is not correct explanation of (A).

86. The problem relating to burden of public debt has been dealt by

(a) A.P. Lerner
(b) E. D. Domar
(c) A.C. Pigou
(d) A.H. Hansen
Select the correct answer from the options below:

Correct Answer: (b) (b) and (c)
Solution:

The problem relating to burden of public debt has been dealt by E.D. Domar and A.C. Pigou.

87. Given below are two statements- one is lablled as Assertion (A) and the other is labelled as Reason (R):

Assertion (A): In order to control inflationary tendencies, RBI raises the repo rate
Reasons (R): By so during, RBI wishes to control consumption demand
In the light of the above two statements choose the correct option:

Correct Answer: (a) Both (A) and (R) are true and (R) is correct explanation of (A)
Solution:

In order to control inflationary tendencies. RBI raises they the Repo Rate and by so during, RBI wishes to control consumption demand.

88. Given below are two statements- one is lablled as Assertion (A) and the other is labelled as Reason (R):

Assertion (A): Inclusive growth is a must a country like India
Reasons (R): India is an open economy with a significant external sector
In the light of the above two statements choose the correct option:

Correct Answer: (b) Both (A) and (R) are true and (R) is not correct explanation of (A)
Solution:

Inclusive growth is a must for a country like India is correct statement. India is an open economy with a significant external sector is also correct reason but not correct explanation of assertion.

89. Given below are two statements- one is lablled as Assertion (A) and the other is labelled as Reason (R):

Assertion (A) Parties to a dispute over property rights will be able to negotiate an economically optimal solution
Reasons (R): There are efficient, competitive markets and there are no transaction costs
In the light of the above two statements choose the correct option:

Correct Answer: (a) Both (A) and (R) are true and (R) is correct explanation of (A)
Solution:

Parties to a dispute over property rights will be able to negotiate an economically optimal solution and there are efficient, competitive markets and there are no transaction costs. Both A and R true and also R is correct explanation of (A).

90. Given below are two statements- one is lablled as Assertion (A) and the other is labelled as Reason (R):

Assertion (A): Disguised unemployment is present in India
Reasons (R): Agricultural productivity at margin is close to zero
In the light of the above two statements choose the correct option:

Correct Answer: (a) Both (A) and (R) are true and (R) is correct explanation of (A)
Solution:

Disguished unemployment is present in India and agricultural productivity at margin is close to zero.